Thursday, September 27, 2007

Dubai: Rising out of the 'fog' to claim her role in international commerce

Dubai's skyline rising out of the 'fog' as global money markets realign.

How does a 'holding company' become a global financial powerhouse in 2 months?

It's easy if you're the Prime Minister and VP of the United Arab Emirates, as well as, the ruler of Dubai. Sheikh Mohammed bin Rashid Al Maktoum created Borse Dubai on August 6, 2007, which essentially consolidated the Dubai Financial Market (DFM) and the Dubai International Financial Exchange (DIFX).
The Dubai Government announced today that it will consolidate its holdings in Dubai Financial Market (DFM) and Dubai International Financial Exchange (DIFX) into a new holding company, Borse Dubai.

[Dubai's] move is in line with the Dubai Strategic Plan 2015, and demonstrates its commitment to further position Dubai as the leading capital market in the region dubaisharetalk
So, I guess that means that Dubai's 'exchange' markets are effectively under the control of the ruler, Sheikh Mohammed bin Rashid Al Maktoum, right?

Here is when it get interesting. Borse Dubai and NASDAQ immediately participated in a bidding war for a company named OMX. OMX is a Swedish/Finnish financial services company with an amazing highly desired integrated 'back end technology' which consolidates other money market 'exchanges'. Formed in 2003, OMX has become a financial leader which makes gaining OMX paramount.
[OMX] in addition to owning and running exchanges in Sweden, Denmark, Finland, Iceland and the Baltic states, provides technology to about 60 exchanges worldwide, including the Australian Securities Exchange, Nordic power market Nordpool and the Singapore Exchange. khaleejtimes

How did the bidding war end up? Well...on Sept. 20th the craziest transactions occurred. Borse Dubai and NASDAQ became partners.

Here is the shady agreement in a nutshell.

Borse Dubai buys OMX..'gives' it to the NASDAQ in a complex trade scheme for a 20% stake in NASDAQ in New York and 28% of the NASDAQ owned stock in the London Stock Exchange (LSE). Along with gaining OMX, NASDAQ will become the principal strategic partner (33%) in the Dubai STATE OWNED DIFX. So in essence , Borse Dubai, within 2 months of its inception, gained a firm grasp of the western 'exchanges' and economically tied Dubai, the United States, Europe, and the Middle East together. Which has been their intent all along.

According to the NASDAQ press release
NASDAQ Increases Certainty of OMX Combination

Borse Dubai to become a 19.99 Per Cent Shareholder in NASDAQ;
Restricted to 5 Per Cent Voting Rights

Steps taken to allow DIFX to be rebranded with the NASDAQ Brand

NASDAQ to Become a Strategic Shareholder in DIFX

Borse Dubai Purchases a 28.0 Per Cent stake in LSE From NASDAQ
Borse Dubai to become a 19.99% shareholder in NASDAQ (capped at
5 per cent voting rights)

NASDAQ will acquire all OMX shares to be purchased by Borse Dubai
in its offer for OMX

NASDAQ will become a strategic shareholder and the principal
commercial partner of Dubai International Financial Exchange

DIFX will be re branded with the NASDAQ brand and licensed with market leading technology from the NASDAQ/OMX combination
Thursday, Sept. 20th, became much more complicated, though...Qatar, using the Qatar Investment Authority (QIA) freaked upon hearing of the 'agreement' and went on a spending spree. They purchased roughly a 10% share of OMX and sent out a release to shareholders of OMX to 'take no action' on the NASDAQ/Dubai 'agreement'. Then QIA went ahead and purchased a 20% stake in the London Stock Exchange and on Friday, bought the remaining 5.3 million shares of NASDAQ owned shares in the LSE.
Qatar and Dubai are now the two biggest shareholders of the LSE, holding almost half of the world's third-largest stock exchange.reuters
Even more interesting...Qatar will not disclose who they received the money from to buy the LSE shares but, sources say Citigroup will be buying more shares of OMX to help out the QIA.
...sources familiar with the matter said Citigroup was seeking to buy shares in the market on behalf of the QIA.

Qatar said it had bought 20 percent stake of the London Stock Exchange through the Qatar Investment Authority (QIA) and urged OMX shareholders to take no action on the Dubai/Nasdaq offer. Sources familiar with the matter later said the QIA was buying OMX shares. khaleejtimes
Shady, right? It still gets worse.

On Thursday, the infamously shady Carlyle Group sold a 7.5 % stake in their own 'group' to another UAE emirate, Abu Dhabi. Abu Dhabi is basically the 'hub of US Naval forces' in for the Middle East and USAF has a 'huge' air base there. Later they announced they will purchase Canada's PrimeWest Energy Trust.
Abu Dhabi National Energy Co., the state-controlled power generator and oil producer, agreed to buy Canada's PrimeWest Energy Trust for about C$4 billion ($4 billion) in the biggest-ever North American takeover by a United Arab Emirates company.

PrimeWest assets include properties in Montana, North Dakota and Wyoming. The deal is unlikely to spark the furor caused by the planned purchase by Dubai World's DP World unit last year of six U.S. port terminals through its acquisition of London-based Peninsular & Oriental Steam Navigation Co., said Eckart Woertz, chief economist at the Gulf Research Center in Dubai. bloomberg
It's all scandalous.

The obvious signs of subversion are taking place, yet there is no OUTRAGE. Our lawmakers, SEC, Homeland Security and the mainstream media are letting US down. The NASDAQ/Dubai deal is realigning our economies in a complex 'arrangement' that has given the Middle East leverage over western economies.

Homeland Security and the SEC are a joke. If they can't see this obvious subversion and crime they are useless. The DP World fiasco in 2005 was the first attempt at giving Dubai access to America's 'national interests'...the Nasdaq/Dubai arrangement is far worse. Far more dubious. Far more dangerous.
Such alliances could become a way for corporations to get around some political sensitivities about outright takeovers of key national assets

This kind of exchange in the sense of swapping stakes, this reciprocal cross holding, is possibly a substitute for a straight merger because there would be political difficulties in a straight merger," said international securities expert John Coffee, a Columbia University Law School Professor.

We're increasingly going to find that these petrol dollars will migrate not to treasuries but to capital assets in the United States ... and investments in money managers like Carlyle. reuters

according the Sen. Schumer, ""At this early stage this deal gives me pause... While I am and have been a big proponent of foreign investment in the United States, we must still be careful of the kinds of investments made in our critical infrastructure, financial exchanges, utilities, and other areas that are vital to the operation and security of our country...the Dubai exchange "is majority owned and controlled by the government of Dubai, which has previously been cited as a nexus of terror financing, money laundering, and a potential crossroads for shipping and trading for Iran in their quest for nuclear materials and technology." freeinternetpress
I'm sure we are all fine (sure), Although Bush won't speak of the deal in the U.S. he has stated..
US President George W. Bush said the authorities would probe security implications of the deal. "We have a reform process in place that will be able to deal with this issue," Bush said.uaeinteract
and the drama continues... Nancy Pelosi has weighed in on the issue demonstrating that she is a pathetic lawmaker who is in bed with the Bush administration. She has lost my support forever with her 'profound statement'...
"It doesn't raise alarm bells...This is a marketplace issue."
Take her down, Cindy...her 'table' is full of deceit. Deceit leads to war...

Relating news story to watch:
OMX signs IT outsourcing deal with Verizon
" Verizon will take charge of OMX's external network operations and data centre management from Oct. 1 "
Conference in New York to woo investors to Dubai
Fears of dollar collapse as Saudis take fright

Same Players. Different Scandal.

1 comment:

webmastermarkt said...

And what will better in the future?